The stock started the day by diving an eye-popping 25 per cent following the announcement by the company on Thursday evening that it has been asked by the government to share 50 per cent of the convenience fee revenue with it.
The announcement was a body blow for stock that had been flying high on euphoria among investors for Internet platform companies. With Rs 18,000 crore shaved off the company’s market value within minutes and investors crying foul over social media platforms, the government did what it does best. Rollback!
The announcement from the DIPAM secretary that the demand from the government has been rolled back, helped the stock recover all of the losses momentarily. However, the sense of nausea wouldn’t leave as the move has bred uncertainty that is not easy to let go off. The result, therefore, was that the shares of the company eventually closed nearly 8 per cent lower.
Lupin’s horror show brings delight
The drugmaker’s September quarter earnings were a horror show of the highest order. It posted a consolidated net loss of more than Rs. 2,000 crore because of another one-off loss it took on some asset it owns.
Lupin has made a habit out of surprising investors with such results over the past three years. Usually, it waits for the last quarter of the financial year to drop such bombs but this time Halloween came early for the company. And yet, the shares of the company soared over 5 per cent because the management suggested that margins will only go up from here after hitting rock-bottom.
DRL brings surprise elation
If Lupin’s earnings were a disaster, Dr Reddy’s were stellar. The company beat Street’s estimates on all three fronts: net profit, sales and margins.
The performance drew an instant reaction as the stock soared over 5 per cent, especially, as its US business posted double-digit sequential growth in the September quarter. However, the joy only lasted a little while as the company announced that its Duvvada unit had received eight observations from the US drug regulator following an inspection. The stock closed a little over 1 per cent higher.
